March 2012
Corporate Responsibility and Sustainable Economic
Development in China: Implications for Business
ABOUT THIS PAPER
This paper provides a strategic briefing on the state of corporate social responsibility (CSR) in China. It seeks to inform
companies, policy researchers, and stakeholders concerned with China’s development and CSR more generally.
A note on terminology: “CSR” has become the most common umbrella term in China for the constantly evolving domain
that includes the social, environmental, and economic impacts of business. For the purpose of this paper, CSR is treated as
analogous with the international use of terms such as corporate responsibility and business sustainability.
The paper was written by Simon Zadek, Maya Forstater, and Kelly Yu. It draws on the authors’ broader body of work, thirdparty research and data from official sources, companies, the burgeoning network of CSR researchers in China, and interviews
with CSR practitioners.
The authors are grateful to the people who took time to contribute their thoughts and experiences to the report, as well as
those whose research we quote. In particular we would like to thank Becky Fraser, U.S. Chamber of Commerce; CY Yeung,
Intel; Hong Jun, Microsoft; Oliver Yang, AmCham Shanghai; Guo Peiyuan, Syntao; Michael Bloomfield and Lanlin Bu, Harmony
Foundation; Kaying Lau, Global Reporting Initiative; Kelly Lau, Nike; Ma Jun, Institute of Public & Environment Affairs; Dr
Lu Jianzhong; Jim Gradoville, WWF; Wang Xiaoguang, Rongzhi CSR Research Institute; Simon Lv, Non-Profit Incubator; Bill
Valentino; and Fiona Lang, Ruder Finn.
Errors and omissions are the sole responsibility of the authors. The authors welcome comments and can be contacted
at simon@zadek.net.
Table of Contents
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
2
Executive Summary...............................................................................................................................................3
CSR in China..........................................................................................................................................................6
Challenges to Sustainable Economic Growth............................................................................................6
The Rise of CSR in China..............................................................................................................................7
Is CSR Different in China?.............................................................................................................................9
The CSR Agenda is Increasingly Strategic..........................................................................................................10
CSR as a Complement to Public Policy.......................................................................................................12
The Supply Chain Challenge........................................................................................................................13
Emerging National CSR Standards and Expectations...............................................................................14
Demanding Domestic Stakeholders............................................................................................................16
Implications for Business.......................................................................................................................................17
CSR in China Demands a More Strategic Approach..................................................................................17
The Next Generation of CSR Leadership....................................................................................................17
Key Steps to Upgrade CSR...........................................................................................................................18
The Road to a Sustainable Global Economy Runs Through China...................................................................19
Appendices............................................................................................................................................................20
Endnotes........................................................................................................................................................20
CSR Reporting by Chinese Companies and MNCs in China....................................................................21
Who’s who in CSR in China...........................................................................................................................22
About the Authors and Related Research..................................................................................................23
Further Research...........................................................................................................................................24
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
EXECUTIVE SUMMARY
China’s rapid economic rise has led to social and environmental challenges that must be addressed
to avoid weakening the nation’s ability to sustain economic growth and development progress in
decades to come. These challenges, such as water scarcity, pollution, labor conditions, and product safety, along
with the need for improved governance and accountability, are widely acknowledged and figure prominently as
targets for action in China’s 12th Five-Year Plan (12 FYP).
The role of business in addressing these challenges is increasingly recognized and is reflected in the call
for, and practice of, corporate social responsibility (CSR). In China, the term CSR covers a wide scope of issues that
can also be described as citizenship and sustainability. It describes actions taken by businesses to provide benefits
that either markets or governments have failed to deliver and to offset negative social and environmental impacts.
CSR in China has evolved rapidly beyond its roots in philanthropy and compliance. For large companies,
CSR is increasingly a strategic concern, addressing issues such as employee management, product quality,
governance, and human rights. Managing such issues, which affect the core business, can deliver strategic benefits
for supply chain efficiency and security, innovation, product development, attraction and retention of talent, and
investor confidence.
Drivers of CSR in China are also shifting toward becoming embedded in China’s own global brand and
way of doing business. Initially, pressures on multinationals for CSR tended to come from public interest groups
and consumers in the West. However domestic Chinese pressure is rising. Chinese citizens are increasingly finding
ways to express collective displeasure over perceived poor corporate practices. At the same time, Chinese businesses
are raising the bar for competition as they work to meet international standards of responsibility as part of their
strategy for moving up the value chain.
The most important driver in recent years has been the increasingly close relationship between CSR
and public policy. The Chinese government has embraced CSR as a tool to help address social and environmental
issues resulting from rapid but uneven economic transition. In an economy so influenced by the state, official
endorsement of CSR standards, ratings, and indexes makes demonstrating performance against them a material
factor in determining competitive advantage.
CSR will continue to evolve rapidly, with pressure from the state and, increasingly, from citizens. A
significant dynamic to watch will be the interaction between pressures from the state and from citizens mobilizing,
for example, through new social media.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
The Shifting Landscape of CSR in China
Yesterday
What is changing?
Tomorrow
CSR viewed by government as a
foreign-imposed requirement
with protectionist aims.
Government using CSR to encourage businesses to contribute to
“scientific development” and a
“harmonious society”.
CSR becoming a key factor
determining competitive
advantage for companies
in China and for China in the
global economy.
Focus on ensuring supply
chain labor and environmental
standards through codes of
conduct and audit.
Recognition of the limits of audit
approach.
CSR in the area of
manufacturing is more
focused on building
capacity for environment
health and safety (EHS)
and HR management as
well as local enforcement
of environmental and
labor laws.
Tightening domestic labor and
environmental laws and maturing
of enforcement.
Partnership and capacity building
for labor and environmental
compliance.
Concern that many international
standards initiatives represent
trade and investment barriers,
intentionally or otherwise.
Cautious endorsement and
adoption of international
standards.
Learning and referencing international standards to construct
China’s CSR framework.
Multinationals tended to roll
out global CSR practices and
signature programs, while stateowned enterprises have viewed
CSR as a matter of accountability
to government.
4
Growing and confident consumers,
nongovernmental organizations,
media, and other local stakeholder
groups are making stronger demands on business responsibility.
Development of national
standards that are in
practice increasingly
harmonized with
international standards.
Increasingly active and
demanding consumers and
civil society; developing
and testing bottom-up
grievance and redress
mechanisms.
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
The business case for CSR in China is to both secure a domestic license to operate and to help shape
the global competitive environment to reward sustainability. Multinational companies are likely to face
particular scrutiny for their social and environmental performance, and will be expected to demonstrate that they
are contributing to China’s national priorities. These include green growth, livelihood improvement, outward
development into the West, and a general integration of Chinese businesses into global markets. At the same time,
as China’s influence in international markets and on the global policy stage increases, active engagement in CSR
offers an opportunity to influence one of the most powerful forces shaping the landscape for global business and
sustainable development.
In light of these challenges and opportunities, and the increasing complexity of doing business in
China, all companies will need to strengthen their approach to CSR. Approaches need to be integrated with
business strategy and responsive to evolving local concerns, pressures, and opportunities.
This will require upgraded capacity to develop, define, and implement “In-China-for-China” CSR
strategies. CSR strategies in China can be supported by global standards and corporate signature initiatives, but the
strategies cannot be defined by them. Multinationals should build and empower strong local teams to handle CSR at
strategic levels. These teams should go beyond the public relations department to closely align with functions such
as public and government affairs, legal and compliance, customer engagement, and strategy development. National
and regional chief executive officers as well as visiting senior executives should also be sensitive to the role of CSR in
negotiating and demonstrating the company’s contribution to China.
Multinationals operating in China can contribute to, but not impose, the pace and direction of
emerging national CSR frameworks and debates. Sharing international experience with addressing social
and environmental issues in business can help support the development of local CSR frameworks in China that
are broadly convergent with global best practice. This may take place both through international associations and
vehicles, but also crucially by engaging with domestic business associations, policy institutions and relevant research
institutes and think tanks.
The following are key steps for the next generation of CSR leadership in China:
• Recognize the strategic content and focus of CSR, while not ignoring the more traditional
community engagement aspects.
• Build responsive stakeholder relations, while maintaining a clear alignment to China’s
development priorities.
• Engage actively and sensitively in China’s development of CSR frameworks.
• Localize the art of CSR and stakeholder engagement in the business.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
CSR IN CHINA
Challenges to Sustainable Economic Growth
Over the past few decades, China has experienced an extraordinary economic rise, establishing the nucleus of a
modern economy underpinned by a skilled middle class, a rapidly developing infrastructure, and an ambitious and
successful business community.
The environmental and social cost of this economic growth and the potential to develop more sustainably is a
growing concern of government, business, and citizens. A report, produced by the China Academy for Environmental
Planning (under the Ministry of Environmental Protection) estimates that pollution, spills, and other negative
environmental impacts cost the economy an estimated 1.3 trillion RMB annually, currently equivalent to about 4% of
China’s gross domestic product. If these challenges are not addressed, they will weaken the nation’s potential and
achievements in coming decades.
EXHIBIT 1: CHINA’S SOCIAL AND ENVIRONMENTAL CHALLENGES
• Water scarcity and quality – In 2005, around 300 million rural residents lacked access to safe
drinking water. The government’s aim is that all rural residents will have safe drinking water by 2015.2
As of 2007, Guangdong was treating only 50% of the province’s domestic sewage, and 45 medium-size
cities were completely lacking any wastewater treatment facilities.3
• Industrial pollution and greenhouse gas emissions – In 2006, 43% of China’s cities did not
meet category 2 air-quality standards. A 2009 report said that this had decreased to 17% and also
acknowledged that some cities suffer serious pollution.4
• Labor conditions – Labor conditions have improved in the past decades, but the issue of excessive
overtime has proved particularly intractable. Tactics of double and triple record keeping, model factories,
and secret subcontracting have been well documented and widely acknowledged. Recent worker
suicides at Foxconn, a contract manufacturer and the world’s largest maker of computer components,
were attributed to work pressure and excessive hours.5
• Product safety – Product and food safety scandals and recalls have led to deaths, illness, and injury;
damaged the reputation of the Chinese business brand overseas; and resulted in domestic unrest.
• Corruption – Widespread corruption is one of the areas of strongest public concern and is increasingly
recognized by the Communist Party of China as a critical obstacle to the country’s social and economic
development. China scores 3.6 on the Transparency International Corruption Perceptions Index (where 10
indicates maximum trust in government integrity), ranking above India and Russia, but below Brazil and
South Africa.
• Inequality and economic exclusion – Although a small proportion of individuals have become
extremely wealthy, the income of many citizens has not kept pace with economic growth over the past
decade. The divergence in quality of life between China’s urban and rural residents is especially large.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Domestic recognition of the need to transform the economy toward a more sustainable and inclusive future
is reflected at every level. Premier Wen Jiabao has repeatedly characterized the current economic model as
“unbalanced, unstable, uncoordinated, and unsustainable”. Such views are reflected in China’s 12th Five-Year Plan,
and reinforced by increasingly vocal concerns expressed by Chinese people through local protests, petitions, and
social media.
There is no doubt that China’s leadership is fully aware of the challenge and is committed to addressing it through
ambitious investments and policy initiatives. This ambition will need to be translated into equally forceful practice
for China to overcome the significant obstacles to its goals for green and inclusive growth. Enabling institutional
developments will be particularly important in closing the enforcement gap. These developments will, in turn, require
innovations in monitoring and oversight, including means by which citizens can be better informed and find avenues
for more effective participation.6
The Rise of CSR in China
The government is increasingly looking to business for help in addressing these challenges. The role of the private
sector in national development is seen in terms of the core business of investment, training and technology
development, and also partnerships, and support to build the institutions, policies, and local capacities needed for a
sustainable economy.
EXHIBIT 2: CSR IS A MAINSTREAM CONCERN IN CHINA
• Policymakers – The Chinese government, for example, the Ministry of Environmental Protection
(MEP), the Ministry of Commerce (MOFCOM), the State-Owned Assets Supervision and
Administration Commission of the State Council (SASAC), and the China Banking Regulatory
Commission (CBRC), is advancing policy measures to encourage CSR across the business
community. International collaboration through platforms such as the China Council for International
Cooperation on Environment and Development has supported these advancements through
increased understanding, exchange of experience, and cooperation in developing policy options for
the Chinese government to consider.
• Business leaders – A 2010 survey of Chinese business executives and academics by Fortune
Magazine China found that 89% agreed that social and environmental responsibility can contribute
positively to long-term business performance.7 A 2011 Conference Board survey found that while
Chinese companies do not rate themselves as far ahead as multinationals on current CSR practice,
they have a higher level of aspiration.
• Consumers – 80% of consumers in China say that they have made a purchase from a brand
because of its social reputation in the past year (second only to consumers in Mexico and Brazil and
ahead of those in the United States and Europe).8
• Capital markets – Both the Shanghai and Shenzen stock exchanges have issued guidance on CSR.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
The rise of CSR in China is illustrated by the increased number of Chinese companies issuing CSR reports, as well as
the multinational corporations reporting on their activities and impacts in China. Less than five years ago, few companies in China made any public mention of CSR. Now, more than 700 companies publish an annual report on their
environmental and social performance, and 71 of the largest 100 Chinese companies publish a CSR report. This in particular reflects the government mandate for central state-owned enterprises to publish a CSR report.
EXHIBIT 3: CSR REPORTING IN CHINA
Chinese company CSR reports are often long, with extensive narrative detail and cover of a wide range of
indicators and issues. Coverage of specific issues is varied. (see appendix 1).
Research by the local media WTO Tribune in 2009 concluded, “the overall performance of CSR reporting
practices in China is low as about half of reports are still at the starting stage and characterized by
inadequate disclosure in depth and breadth, low coverage of indicators and a certain gap in responding
to stakeholder requirements and expectation and embodying the corporate value.”9 Assessments of
materiality, independent assurance, forward-looking targets, and stakeholder perspectives are less
common than in the global CSR reports of U.S., European, and Japanese MNCs.
Nevertheless, the quality of these reports is improving as companies develop better data systems
and as reporting formats and indicators become standardized. At least 60 Chinese companies use
the international Global Reporting Initiative (GRI) Guidelines. In 2010, the China Overseas Shipping
Company (COSCO) demonstrated that a Chinese company could develop a CSR report to meet the
requirements of the GRI at the most stringent “A+” level. Most other Chinese companies using the GRI
system have not yet applied a level to their reporting. Of the more than 100 reports from companies in
China featured as part of the GRI database, 80 have not declared a level. 10 However, it is reckoned that
many would already rate a B or C.
Some Chinese companies have begun to report specifically on the sustainability of their operations
outside of China. For example, in addition to its overall sustainability report, Sinosteel has published
separate sustainability reports on its operations in Africa and Australia. China National Petroleum
Corporation has published sustainable development reports on its operations in Kazakhstan, Sudan, and
Indonesia. Huawei released a CSR report covering its operations in North America.
At the same time, many MNCs have begun to publish specific CSR or sustainability reports to cover their
operations in China. Not all of these, however, are aligned to their global reporting frameworks; some
focus largely on philanthropy programs or individual “good deeds.” The most advanced are developing
in-China, for-China reports aligned to their global frameworks and supported by local stakeholder
dialogue. Those recognized for excellence include BASF, Intel, and Coca-Cola, which focus on the
alignment of the business to China’s development priorities.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Is CSR different in China?
The development of CSR in modern China has in many respects followed a pathway comparable to recent international experience. Initial approaches by multinationals and Chinese companies often took the form of sponsorship of
local educational and sporting facilities, tree planting, and other small-scale environmental and community efforts.
Industries that sourced manufactured goods in China were also concerned about ensuring supply chain, labor, and
environmental compliance.
CSR in China is rapidly evolving, as it increasingly becomes seen as a state-supported expectation for
doing business.
EXHIBIT 4: OFFICIAL ENDORSEMENT OF CSR
Key milestones signaling government endorsement of CSR include the following:
• In 2006, the new Company Law stated, “Corporations in their business operation must
abide by the laws, regulation, social and business morality and good faith rules, must accept
supervision by government and the public, and must undertake social responsibilities.”11
• In 2007, the Ministry of Commerce (MOFCOM) issued the Circular on Enhancing
Environmental Surveillance on Exporting Enterprises to restrict socially irresponsible
enterprises from conducting foreign trade.12
• In 2008, the State-Owned Assets Supervision and Administration Commission of the State
Council (SASAC) published the Guidelines on CSR Fulfillment by Central-Level Enterprises.
These guidelines (which are, in effect, mandatory) present CSR as the way for enterprises
to contribute to China’s national development goals, through providing infrastructure,
contributing to economic growth, strengthening competitiveness, enabling innovation,
improving reputation, and enhancing employee productivity and engagement.13
The state’s adoption of CSR, in part, reflects a pragmatic recognition that it cannot on its own address the challenges facing the country as it undergoes rapid but uneven economic transition. It also reflects the experience of
Chinese state-owned enterprises (SOEs) establishing themselves as international operators or global
brands. These entities found that CSR frameworks and standards offered a useful tool for moving up in the value
chain and negotiating the complex demands of consumers and civil society in diverse environments.14
The link between CSR and the state in China is not simply the case of a government setting requirements for doing
business in the country. CSR is becoming an embedded aspect of China’s own global brand and way of
doing business internationally. As China begins to assert its leadership over the sustainability agenda on the international economic and policy stage, CSR will become a key part of the government’s approach.
9
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
THE CSR AGENDA IS INCREASINGLY STRATEGIC
From its early roots in philanthropy and compliance, CSR in China has developed into a strategic concern addressing
the efficiency and security of supply chains, development of new products and services, the competition for talent,
and the reputation and other gains from credible governance and accountability.
EXHIBIT 5: EXAMPLES OF NEXT-GENERATION CSR IN CHINA
Energy conservation and emission reduction – Bao Steel sets company-wide goals and targets for
energy conservation and emission reduction, and has made significant investments in environmental
management systems. Newly acquired production units are integrated into this system to ensure
consistent performance on energy conservation and environmental protection.
Partnerships – Intel China’s social innovation approach is based on working with local governments
and building the capacity of nongovernmental organizations (NGOs) in order to better understand
and address social and environmental issues and create shared value. The company, for example, is
investing in Chengdu in the West, by working closely with local communities, government, NGOs, and
business partners to develop and implement a common growth strategy aligning their products and their
production investments with the region’s development priorities.
Policy alignment – China State Grid issued a white paper explaining the company’s strategic thinking,
mission, emphasis, implementation, and planning objectives in relation to national priorities for green
development.
Standard setting – Vanke has pursued a green building initiative for the past decade and has integrated
the concept into its overall business process. The company is also playing a leading role in developing
and championing industry standards for green building.
Using core competencies to solve problems for China – Microsoft’s CSR efforts are focused on how
information communications technologies (ICTs) can help solve China’s need for better rural education.
The company works with NGOs and local governments to provide computer skills training for migrant
workers, both in cities and rural areas, so as to strengthen their competitiveness in the job market.
Global-local collaboration – Nokia, Motorola, and China Mobile have launched a cross-sector
partnership urging people to recycle their old phones. BASF China’s “1+3” CSR program provides training
to business partners in the supply chain to integrate CSR into their business operations.
Full life cycle responsibility – Coca-Cola China is not only working to manage its own energy
consumption and water footprint, but it also extends its responsibility to the impact of its products and
packaging post-consumption. Recently, the company announced that it had replaced PVC labels because
they pose risks if handled improperly during the recycling process.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Studies of the development of CSR in other countries have identified a series of learning stages.15
EXHIBIT 6: CSR LEARNING STAGES
Stage
What organizations do
Why they do it
Defensive
Deny practices, outcomes, or
responsibilities.
Defend against attacks on their reputation
that in the short term could affect
sales, recruitment, productivity, and brand.
Compliance
Adopt a policy-based compliance
approach as a cost of doing business.
Address medium-term reputation and
litigation risks.
Managerial
Embed the societal issue in the core
management processes.
Achieve longer-term gains by integrating
responsible business practices into their
daily operations.
Strategic
Integrate the societal issue into core
business strategies.
Gain a competitive edge by innovating
products and processes to align with
emerging societal concerns.
Civil
Promote broad industry participation in Enhance long-term economic value by
corporate responsibility.
overcoming obstacles to sustainable
development.
Perhaps more than anywhere else in the world, CSR in China is focused on ensuring compliance on social
and environmental issues. However, the trends are moving rapidly into the strategic stage where
business can gain a competitive advantage by aligning their strategy to address societal
concerns, and further towards the civil stage where broad industry action is aligned to
national sustainable development priorities.
Going forward, there are clear signs that CSR will continue to evolve rapidly in terms of its scope and ambition, and links to public policy and local stakeholder action. The following chapter highlights recent trends
and ongoing developments in four key areas:
• CSR as a complement to public policy
• The supply chain challenge
• Emerging national CSR standards and expectations
• Demanding domestic stakeholders
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
CSR as a Complement to Public Policy
Yesterday’s CSR in China
CSR viewed by government as a
foreign-imposed requirement
with protectionist aims.
What is changing?
CSR has become a tool of public
policy to encourage businesses
to play a role in contributing to
“scientific development” and
“harmonious society.”
Tomorrow’s CSR in China
CSR is becoming a key factor
determining competitive
advantage for companies in
China and for China in the global
economy.
For many large businesses, the most important factor characterizing CSR in China is the proximity to public policy.
From an initially skeptical stance, the government has become an active promoter of CSR, with a particular focus on
the performance of large Chinese SOEs and foreign-invested companies.
Starting in 2006, strategic thinkers within the ruling communist party began to recognize that CSR, rather than being
a protectionist threat to Chinese competitiveness, could be used as a tool to contribute to social sustainability and to
address the ever more pressing environmental problems caused by rapid growth.
CSR is now seen as a way to ensure that companies and industry sectors contribute to China’s responsible
development through their investment, products, services, technology, and know-how. This is reflected in
the endorsement of CSR at the highest levels and in the development of a nationally rooted body of research,
standards, rankings, and guidance.
Evidence of this development has been the emergence of many state-sponsored guidelines and standards. These
include both hard laws (e.g., environmental disclosure regulations, labor law, Administrative Measures on the
Control of Pollution Caused by Electronic Information Products, and the Circular Economy Law) and soft
law guidelines set by government departments and local governments. These efforts are joined by guidelines from
stock exchanges, industry associations, and academic institutes, which also have some official endorsement.
The new standards and guidelines draw not only on established international practices but also on the government
priorities on green growth, balanced and sustainable development, and “harmonious society.” In addition to the explicit CSR policies, China’s national frameworks for economic growth are the key context against which businesses’
contributions are measured. For example, China’s long-term development strategy aims to achieve a 40–45% cut in
carbon dioxide emissions generated per unit of economic output by 2020, compared with 2005 levels. China’s 12th
Five-Year Plan, for example includes goals for saving energy, reducing emissions, improving energy efficiency, and
enabling clean energy development as well as tackling disparities in health, education, and economic opportunity.
Foreign companies are coming under particular scrutiny and are being asked to demonstrate that they are managing
their investments in ways that support domestic policy and administrative goals.
Interviews and surveys with business executives confirm that government policy is seen as the key reason for
companies to take CSR seriously. For example, CSR consultancy Syntao’s survey of sustainability reporting practitioners in China found that raising the enterprise’s profile and supporting government policy were the most often
cited reasons for reporting.16 A 2011 survey on the opinions of citizens in 16 major cities by Liao Wang (Outlook Week),
a weekly magazine under the supervision of Xinhua News Agency, found that 66% viewed government as the major
driving force for CSR in China.17
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
The Supply Chain Challenge
Yesterday’s CSR in China
Focus on ensuring supply
chain labor and environmental standards through codes of
conduct and audit.
What is changing?
Recognition of the limits of audit
approach.
Tightening domestic labor and
environmental laws and maturing
of enforcement.
Partnership and capacity building
for labor and environment
compliance.
Tomorrow’s CSR in China
CSR in the area of
manufacturing is more focused
on building capacity
for environment health
and safety (EHS) and HR
management as well as
for local enforcement of
environmental and labor
laws.
Since the early 1990s, a key strand in CSR for MNCs in China has been a focus on environment and labor conditions
in the supply chain. Challenges to public enforcement systems have been addressed through private codes of
conduct and an extensive system of factory audits by buyers and their agents and, in some cases, by independent
certification teams.
Supplier standards for environment, health and safety, and labor conditions are now widespread. However, while
codes of conduct and auditing have supported improvements in facilities, fire safety, and equipment, the combination
of competitive price and time pressure, and inexperienced and undercapitalized factories, has led to continuing
compliance challenges.
As buyers and manufacturers take a “Go West” approach, moving from the coast to the inland regions, they are
exposed again to fresh risks and challenging environments. InvestAssure, a corporate responsibility tracking
company that monitors reports of illegal, unethical, environmentally damaging, or socially irresponsible business
behavior in Asia, found that over the past two years 50% of all alerts it tracked and 65% of significant alerts came from
China. The issues tended to relate to occupational health and safety, the environment, and corruption.18
Government and companies increasingly recognize that the answer to this challenge cannot come through ever
stronger private monitoring systems. It must come through building the management capacity of local
suppliers and the enforcement capacity of public institutions. Recent tightening in environmental and labor
regulations, as well as increases in the minimum wage, is welcomed by many companies that have been working to
address these issues on a factory-by-factory basis.
To complement the efforts of the authorities, leading companies are developing new approaches based on capacity
building with factories, labor inspectorates, and occupational health authorities. These longer-term partnerships are
coupled with examinations of their own buying practices, with the aim of demonstrating competitiveness gains to be
made by better management and working conditions. Leading manufacturers, such as Esquel Group, Yue Yuen, and
Chenfeng Group, are responding to this by seeking to develop factories that meet or exceed global standards.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Emerging National CSR Standards and Expectations
Yesterday’s CSR in China
Concern that many international
standards initiatives represent
trade and investment barriers,
intentionally or otherwise.
What is changing?
Cautious endorsement and adoption of international standards.
Learning and referencing international standards to construct
China’s CSR framework.
Tomorrow’s CSR in China
Development of national
standards that are in
practice increasingly harmonized with international
standards.
Around the world, private standards allow public policy makers to privatize the process of developing highly
technical guidance to meet both international trade needs and public policy goals. This has been a key feature of the
CSR movement, where standards covering issues from public disclosure to environmental management, and from
human rights to sustainable products, have helped the country to go beyond individual “good deeds” to established
industry norms.
Internationally, CSR guidelines have tended to be set by multi-stakeholder bodies that draw together public, private,
and civil society involvement. Legitimacy comes from this blend of accountabilities and expertise.19 However,
these blended governance models are unfamiliar and uncomfortable for Chinese companies and are
suspected of being a source of intentional or unintended trade barriers.20
Of the international CSR standards, the environmental management standards developed under the International
Organization for Standardization (ISO) have been seen as most accessible in China and have been adopted quickly.
In 2009, 55,316 Chinese companies were certified under the ISO 14001 environmental management system standard,
a number that represents more new certifications than the rest of the top 10 countries combined. The UN Global
Compact’s 10 principles are also seen as having legitimacy and government approval (as well as offering a low barrier
to joining) and have become increasingly well recognized. To date, more than 180 companies from China have joined
the UN Global Compact, more than either India, Korea, or Indonesia.21
Other international standards, which have achieved a measure of government approval, have also made rapid inroads.
The Forest Stewardship Council (FSC) set up a national initiative in 2007, involving key ministries and think tanks, as
well as other stakeholders. By 2011, the FSC had certified 2 million hectares of China’s forests as sustainably managed
and issued new certification to companies using forest products at a rate of one new company every three days.
Despite the government’s caution toward international standards, China has agreed to adopt ISO’s new CSR
framework, ISO 26000, as a national standard (along with Canada and most of Europe and Latin America).22 The
standard was published in Chinese at the end of 2011, and a few large enterprises are already using it for guidance in
CSR management and reporting.
The past few years have seen an explosion in the development of Chinese CSR standards and rating
systems, as CSR has shifted from being imposed from the outside to becoming a basis for China’s competitive
advantage at home and internationally. These standards, developed by government, industry bodies, or think tanks,
tend to draw their legitimacy from government involvement or endorsement.
14
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
In light of the expansion in standards and guidance, there is a growing call for streamlining and convergence
between Chinese standards and international standards. This effort is recognized as crucial for Chinese standards to
gain international recognition and for companies to be able to operate with a coherent set of expectations.
Chinese and international CSR standards are increasingly converging, with the Chinese government, industry, and
standards bodies engaging in international standards setting. China’s bottom line in negotiating this convergence
with international CSR standards is to avoid the imposition of requirements that conflict with Chinese legal and
public policy priorities. For example, during the development of ISO 26000, China was especially concerned that,
although the standard is not a certification tool, it would act as an umbrella standard drawing together international
norms and a wide range of international CSR standards into a set of common requirements that could be applied to
trade and public procurement. The Standards Administration of China (SAC), acting as China’s government delegate,
took a strong position that the standard’s principle of respect for international norms should be moderated by a
principle of common but differentiated responsibilities and of respect for difference.23 In line with this, the government
says that it will now develop a national CSR standard and certification system, including a mother standard
that is based on ISO 26000 but is also appropriate for the Chinese context.24
The Chinese Certification and Accreditation Agency (CNCA) is currently undertaking a project on behalf of the
Chinese government to investigate other countries’ use and implementation of ISO 26000 and other international
standards. It is cooperating with international standards bodies and has started research to support the development
of a Chinese national standard and certification program for social responsibility.25
The CNCA, under SAC, has undertaken exploratory and capacity-building work on CSR. It is also making initial
moves to establish China’s own national CSR certification system; a research task force was established in November
2010, but the system is still at a preliminary stage of research and preparation. Over the past year, members of the
research team have conducted interviews with a number of leading Chinese SOEs in Shenzhen and Chengdu, such
as Huawei and ZTE, consulted with experts in the field, and visited European countries to understand CSR regimes
and practices. One area where convergence is likely to be particularly sensitive is in the area of human rights. China is a signatory
to the major human rights conventions; however, human rights have not been a high-profile part of CSR approaches
in China, either among Chinese companies or MNCs.26 As a member of the UN Human Rights Council, China recently
endorsed the UN Guidelines on Business and Human Rights, which provides a clear framework of principles
on the state duty to protect human rights, the corporate responsibility to respect human rights, and the need for
remedy when corporate-related abuses have occurred. As companies respond to this framework, they will need to
consider how to put it into practice in China, while Chinese companies will need to develop internationally consistent
approaches, particularly in relation to their overseas operations, such as those in Africa.27
It appears that any initial national standard that emerges will be a consolidation of existing rules and good practices
designed as a bulwark against trade barriers, rather than as a public policy tool for advancing specific national
priorities. New demands for business to contribute to China’s development are likely to continue to be advanced
through a broader range of measures on issues, such as labor to energy efficiency, rather than through a single
national CSR standard. MNCs operating in China need to be sensitive to both of these pathways and contribute to
their pace and direction.
15
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Demanding Domestic Stakeholders
Yesterday’s CSR in China
What is changing?
Multinationals tended to roll out
global CSR practices and signature programs, while state-owned
enterprises have viewed CSR as a
matter of upwards accountability to
government.
Growing and confident consumers,
nongovernmental organizations,
media, and other local stakeholder
groups are making stronger demands on business responsibility.
Tomorrow’s CSR in China
Increasingly active and
demanding consumers and
civil society; developing
and testing bottom-up
grievance and redress
mechanisms.
Over the past decade, the demands of domestic stakeholders have become more sophisticated and organized, while
the importance of addressing domestic stakeholder concerns has risen. This movement came about owing to the
unacceptably high rate of environmental spills and accidents, food contamination incidents, and industrial fatalities.28
In recent years, China was struck by a series of labor-related issues, such as high-profile strikes. In southern China,
auto and parts factories owned by Japan’s Honda Motor and Toyota Motor went on strike. These strikes became headline news, prompting action both by government and companies to improve regulation, enforcement, and performance.
Chinese consumers are learning how to wield their purchasing power to punish and pressure
companies that are not seen as meeting expectations on environmental protection, product safety, and community
investment and to reward those seen as doing well on these issues.29 For example, the Tsinghua-Ruder Finn CSR
Program survey in the auto industry and fast-moving consumer goods (FMCG) reported that Chinese consumers are
becoming less tolerant of companies with poor CSR records. Consumers in China tend to hold multinational brands to
higher standards than local ones.30 The media and consumers frequently complain about double standards between
MNCs’ operations at home and in China, and research reports often compare the CSR of Chinese enterprises and
MNCs and find MNCs lacking. In recent years, the Chinese media have enthusiastically highlighted health and safety
failures, environmental disruption, and pricing monopoly by MNCs in China.
The Internet has aided consumer and citizen engagement on corporate responsibility. In 2008 multinationals
and Chinese companies came under intense scrutiny from China’s “netizens” concerned with the adequacy of
their contribution to disaster relief following the Sichuan earthquake. China has 81 million bloggers drawn from
a community of 340 million Internet users engaged in online discussions about contemporary issues. Citizen and
consumer pressure will probably grow in importance as these groups continue to find their voice.
Competition to attract and retain skilled employees is becoming more intense, owing to labor shortages in industrial
cities of the South and the lack of experienced senior managers. Having a reputation as a good employer and one that
is contributing to development in China is increasingly seen as important in employee recruitment and retention.
In the past three years, there has been rapid development of Chinese NGOs, especially those that provide direct
services to rural areas and communities, and people with disabilities. The Chinese Ministry of Civil Affairs reported
that, as of 2008, China had around 400,000 registered NGOs. Unofficial estimates put the figure closer to 3 million.
Environmental NGOs increasingly play an official role in raising public awareness and enabling public participation in
environmental decision making and regulation.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
IMPLICATIONS FOR BUSINESS
CSR in China Demands a More Strategic Approach
Although the practice and expectations of CSR in China are evolving quickly, one thing that is unlikely to change is
that MNCs, perhaps more than their Chinese counterparts, will feel the pressure for stronger CSR, aligned to Chinese
concerns. This will come from diverse state bodies and increasingly from Chinese citizens using online
social networks as well as more traditional civil society mechanisms.
CSR is increasingly politicized, with foreign companies under particular scrutiny to support domestic policy and
administrative goals. China is no longer aggressively courting foreign investors through preferential treatment, and
Chinese industry is eagerly moving up the value chain, offering goods and services that are competitive with those
provided by MNCs. Given the subtlety of geopolitical issues, demonstrating a substantive contribution to development
is likely to become crucial to the “license to operate” for MNCs in China, and for their ability to grow their business.
At the same time, the alignment of China’s national priorities with the agenda of business sustainability
offers opportunities for companies to create value from innovating in China, for instance through collaboration to develop accessible and affordable health care solutions, green technology, and inclusive business models.
The Next Generation of CSR Leadership
With China becoming an ever more complex place to operate, companies need a more sophisticated approach to CSR.
In the earlier generations of CSR in China, foreign-invested companies were seen as standard setters and examples of
excellence simply by implementing their global practices and signature initiatives. But Chinese companies are learning fast and are driven by a real interest on the part of key Chinese business leaders to do the right thing, to offset
some of the most painful adjustment processes for the population, and to grow the maturity of their companies for the
long haul.
MNC approaches to CSR, however, are often constrained by frameworks that measure investment in terms of shortterm reputational returns and limit the definition of CSR to integrity, EHS, and philanthropy. If CSR in China responds
only to immediate reputational pressures, it is unlikely to develop a strategic response to social and environmental
challenges and opportunities.
MNCs recognize that they face intensifying competition in both business and CSR, so it will no longer be possible
to deliver CSR into China through global templates and programs. It will require a business strategy, rather than a
reputation management approach. This calls for a fundamental change in the ambition, strategic orientation,
and local capacity for CSR. That does not mean abandoning globally adopted standards or signature initiatives.
However, CSR will need to be designed and delivered in China, about China, and for China in order to play its potential, constructive business role.
17
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Key Steps to Upgrade CSR
An upgraded approach to CSR in China can support business innovation, as well as demonstrate a company’s
contribution to national development, which is needed to secure a license to operate. Key steps that companies
should take include the following:
Recognize the strategic content and focus of CSR as well as the more traditional community
engagement aspects.
• Doing and describing good deeds to the community will still be necessary but more will be needed. CSR
should be blended into core business and economic issues, such as innovation, skills enhancement, and the
development of high-value export industries.
• Spell out to the public and to relevant state bodies how the business is contributing to China in ways
that align with national priorities. Green growth, development in the West, and partnerships that help to
establish the Chinese business community in global markets are particularly important.
Broaden genuinely responsive stakeholder relations and maintain clear alignment with China’s
development priorities. Although companies in China have viewed the government as the primary interlocutor
and main determinant of the terms of their engagement with society, it is clear that they will need to develop a
broader approach to stakeholder engagement.
• This means shifting from a public relations and marketing approach toward robust performance reporting
and discussion of issues and challenges.
• It also means developing problem-solving partnerships with NGOs, government and associated
academic institutions, and think tanks that are designed to go beyond reputational benefits to support
business innovation and the development of an enabling environment for sustainable development.
Engage actively and sensitively in China’s development of CSR frameworks. China’s position on
international CSR standards is to welcome learning from global best practices and to ensure that CSR is appropriate
and responsive to the local situation. MNCs will need to be sensitive to support this approach while meeting their
own commitments to maintaining consistent global practices. It is important to ensure that multinationals’ practices
do not accentuate an “us and them” mentality on either side, but encourage joint learning, research, and program
development, always focused on the role of CSR in enabling China’s further development.
• Engage with Chinese-led business associations.
• Support CSR research by leading universities and policy think tanks, especially those informing key
policy developments.
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Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
Localize the art of CSR and stakeholder engagement in your business. CSR in China can no longer be
managed through the cascade-down approach of international standards, corporate templates, and signature
programs. As one CSR manager interviewed stressed, “to grow with China means changing internal politics,
empowering local managers, and developing a local strategy.”
• Empower local teams to engage with local stakeholders, and policy makers on CSR issues, and to develop
business responses, as well as hold philanthropic budgets.
• Create linkages at a local level between CSR and corporate functions such as strategy, government
relations, research and development, and human resources.
THE ROAD TO A SUSTAINABLE GLOBAL ECONOMY RUNS THROUGH CHINA
MNCs that take up this leadership challenge and align their businesses to China’s sustainable development
challenges stand to earn great benefits.
It is clear that CSR can be an effective tool to help secure a license to operate in China. The proposition of doing
business in China is shifting away from low costs and is no longer even just about winning market share in what may
become the world’s largest economy. Going forward, succeeding in China will increasingly be about competing in
what will be one of the most dynamic sites for developing new products, processes, and business models to create
sustainable value in an uncertain and environmentally constrained world.
China is rapidly evolving and is asserting its leadership over the sustainability agenda on the international
economic and policy stage. As China’s influence in international markets and on the global policy stage increases,
active engagement in CSR in China offers an opportunity to influence one of the most powerful forces shaping the
landscape for global business and sustainable development.
19
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
ENDNOTES
1
Existing relevant research by the team can be accessed at www.zadek.net/china2.
2
Ministry of Water Resources. Available at: http://www.mwr.gov.cn/english/sdw.html.
3
Business for Social Responsibility (2006), Water Quality and Environmental Health in Southern China.
4
Ministry of Environmental Protection (2009), Report on the State of the Environment in China.
5
See, for example, Business Week (2006), Secrets, Lies, And Sweatshops (November 27), and Harney, A (2009), The China
Price: The True Cost of Chinese Competitive Advantage, Penguin Books.
6
Ji, Z (Ed.) (2010), China Human Development Report. 2009/10: China and a Sustainable Future: Towards a Low Carbon
Economy and Society, UNDP/Renmin University.
7
Fortune China (2010) CSR Survey, March 2010.
8
Edelman (2010), Citizens Engage! 2010 Good Purpose Survey. http://www.edelman.com/insights/special/GoodPurpose2010globalPPT_WEBversion.pdf
9
WTO Tribune (2009) Research on CSR Reporting in China (2001-2009) Available at: . http://www.csr-china.net/en/
10
Global Reporting Initiative database http://database.globalreporting.org (consulted January 2012)
11
Company Law of the People’s Republic of China, promulgated by the Standing Comm. National People’s Congress, Oct. 27,
2005, effective Jan. 1, 2006. Translation available at: www.lawinfochina.com.
12
MOFCOM (2007), Commercial Information Circular No. 392/2007: Strengthening the Supervision on Export Enterprises
Regarding Environmental Protection. Available at: http://www.tid.gov.hk/textonly/english/aboutus/tradecircular/cic/
asia/2007/ci3922007.html (Chinese).
13
SASAC (2008), Guidelines on CSR Fulfillment by Central-Level Enterprises. Available at: http://www.sasac.gov.cn/n2963340/
n2964712/4891623.html.
14
Guoqiang, L, Zadek, S, and Wickerham, J (2009), Advancing Sustainable Competitiveness of China’s Transnational Corporations, Development Research Centre of the State Council with AccountAbility, London.
15
Zadek, S (Dec. 1, 2004), Path to Corporate Responsibility, Harvard Business Review.
16
SynTao (2008), Journey to Discover Values Available at: http://www.syntao.com/
17
Liao Wang (2011).
18
InvestAssure (2011), Monitoring of Corporate Responsibility in Asia: Analysis of InvestAssure Web Monitoring Alerts, June 2011,
Available at: http://www.source-asia.net/index_files/Page308.htm
19
Guoqiang, L, Zadek, S, and Wickerham, J (2009) op cit.
20
Zadek, S (2010), Emerging Nations and Sustainability; Chimera or Leadership, Harvard CSR Initiative, Working Paper 61.
21
UN Global Compact Membership database.
22
Ward, H (2010), The ISO 26000 Standard and Transnational Democracy, FDSD.
23ibid.
20
24
ISO (2011), 2011 Survey of Post-publication Activities Related to ISO 26000. http://media.iso26000bloggen.se/2011/12/N07PPO-SAG-ISO-26000-Survey-Presentation1.pdf
25
ANSI (2011), ANSI Welcomes CCAA to Discuss ISO 26000 and Other Programs, Press Release 12/12/11, http://news.thomasnet.com/companystory/ANSI-Welcomes-CCAA-to-discuss-ISO-26000-and-other-programs-606959
26
UN Special Representative of the Secretary General John Ruggie, Human Rights Policies of Chinese Companies: Results
from a Survey (Sept. 2007).
27
Bader, C (2008), Business & Human Rights: Corporate Recognition and Responsibility, Human Rights in China. http://www.
hrichina.org/public/PDFs/CRF.1.2008/CRF-2008-1_Corporate.pdf
28
JiangHeng (2008), Presentation on MOFCOM Guidance on Foreign Invested Enterprises, CSR Conducts, MOFCOM/
CAITEC[, June 17 2008 http://www.amcham-shanghai.org/amchamportal/InfoVault_Library/2008/Foreign-Invested_Enterprises%27_CSR_Conducts.pdf
29
Ma Jun et al (2008), Greening China, the Emerging Role of the Public, Institute of Public and Environmental Affairs (IPE),
WWF Hong Kong and CLSA.
30
Edelman (2005), Edelman China Stakeholder Research: Stakeholder Expectations on Corporate China. Summary: http://
www.prnewswire.com/news-releases/eighty-percent-of-opinion-leaders-believe-foreign-mncs-operating-in-china-held-tohigher-standard-of-performance-67545412.html
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
APPENDIX 1: CSR REPORTING BY CHINESE COMPANIES AND MNCS IN CHINA
Area
Labor
issues
Economic
contribution
Climate change
Human rights
Anti-corruption
Public Policy
Key indicators
Prevalence
• Most references are to Chinese labor laws and
then to local labor laws where companies are
operating outside of China.
• Some leading reporters refer to UNGC principles
and ILO Conventions.
• Basic employment data is common, such as
number of employees, employment by age, gender, academic degree, ethnic group.
• Some companies include data on employee training and satisfaction scores, social security and
extra benefits, occupational health and safety
data, death and injury data, and description of
employee aid channels.
Basic employee data
high
Employment contract compliance
high
Social insurance coverage
high
Trade unions
high
Holidays/leave
high
Training
high
Diversity
high
Injuries/deaths
high
Employee satisfaction
medium
• Economic contribution to China is a popular
topic. CSR is often expressed in terms of contribution to economic development.
• MNC and Chinese reports both give coverage of
total investment in China, including fiscal capital,
talent, research and development, etc.
Investment in China
high
Location, number of facilities
high
Job creation
high
R&D
high
Technology innovation & patents
medium
Tax paid
high
Total salary paid
medium
Local sourcing
rare
Energy saving programs
high
Energy saving data
medium
Energy saving targets
rare
GHG emissions/intensity
medium
GHG targets
rare
Method of calculation
none
Climate change/ low carbon development discussion
rare
• Historically, most have not mentioned human
rights. However, leading companies are now
acknowledging human rights in the context of
GRI and UN Global Compact principles, as well
as Chinese laws and government priorities.
• Reporting is concentrated on employee human
rights, in particular nondiscrimination and child
labor.
Commitment to human rights
rare
Policies on human rights
rare
Training on human rights
rare
Performance on human rights
extremely rare
Dilemmas and challenges
extremely rare
Public policy positions
extremely rare
• Quality of reporting is very mixed, ranging between detail on policies, controls, investigation,
and noncompliance to very brief statements of
commitment.
Commitment
medium
Internal controls
medium
Numbers of investigations, findings,
actions
rare
• Involvement in industrial/national standards
drafting/establishment often mentioned by SOEs,
but there is rarely discussion of the content of
policy advocacy positions.
• Companies refer to collective public policy
advocacy efforts toward sustainability, such as
WBCSD and FSC.
Alignment with Chinese government
policy
high
Engagement in policy processes
medium
Involvement in sustainability advocacy
medium
Dilemmas, challenges
rare
Coverage
• Energy savings programs often included, but
few/no targets.
• Some GHG data, but data coverage patchy.
21
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
APPENDIX 2: WHO’S WHO IN CSR IN CHINA
22
Key government agencies
• The Ministry of Commerce (MOFCOM)
• State-owned Assets Supervision and Administration Commission of the State
Council (SASAC)
• Ministry of Environmental Protection (MEP)
• National Development and Reform Commission (NDRC)
• State Administration of Work Safety
• Ministry of Human Resources and Social Security (MOHRSS)
• Local (provincial/city) government (e.g., Zhejiang, Shandong, Shanghai, Shenzhen,
Ningbo)
Key think tanks and
academic institutes
• Development Research Center (DRC) of State Council
• Chinese Academy of International Trade and Economic Cooperation (CAITEC)
• CSR Research Center, China Academy of Social Sciences (CASS)
• Universities affiliated with CSR research centers
(e.g., Tsinghua, Beida)
Key international CSR
initiatives in China
• Social Accountability International (SA8000)
• UN Global Compact
• Global Reporting Initiative
• World Business Council/China Business Council for
Sustainable Development
• International Business Leaders Forum
Awards and ratings
There are a large number of
award schemes, and many
that are seen as promotion for the idea of CSR
rather than a rigorous assessment of performance.
Nevertheless, some awards
systems are viewed as genuine measures of leadership.
• “China’s Outstanding Corporate Citizen-The Most Responsible Entrepreneurs in China” by China Corporate Citizenship Committee (CCCC) – Active participation of delegates from SOEs, private enterprises, and MNCs
• Golden Bee CSR Honor Roll – Hosted by China WTO Tribune, large variety of
different categories of CSR awards
• AmCham Shanghai CSR awards – Organized and announced by AmCham
Shanghai during its annual CSR conference
• CBN CSR Ranking – Initiated in 2008, seen as one of the most influential media
awards for CSR in China
• “Global 500 Companies’ Contribution in China” – Southern Weekend
ranks MNCs based on investment, business performance, regional contribution,
CSR, and brand image.
• Fortune China – CSR ranking launched in 2011
• China Entrepreneurs Club’s “Green Company” ranking – Well respected
as a robust ranking at the cutting edge of CSR practice in China. An appraisal
committee composed of domestic and international experts seeks to identify the
most dynamic examples of CSR.
• Marco Polo award
http://www.uscfie.org/acknowledgement.html
Leading companies
This listing reflects key
award winners in recent
years; however the roster of
celebrated companies often
changes from year to year
depending on performance
and innovation.
MNC: Amway, BASF, Cisco, Coca-Cola, Dell, DSM, Eton, Ford, GE, GM, Hitachi,
Honda, Honeywell, IBM, Intel, Johnson & Johnson, Kraft, L’Oreal, Nissan Nokia,
Omron, P&G, Panasonic, Samsung, Shell, Toshiba, Toyota, Volkswagen.
News services
http://syntao.com/
http://www.chinacsr.com/en/
http://www.csr-china.net/
http://www.csr-asia.com/
Chinese: Baidu, Bank of Communications, Bao Steel, China Mobile, China Coal
Group, China Construction Bank, China Minsheng Bank, China Mobile, China
PingAn, China Railway Group, COSCO, Lenovo, PetroChina, Shanghai Aerospace
Equipments Manufacturer, Shanghai Pudong Development Bank, Sinopec, Sinosteel, State Grid, TCL, Vanke, Yachang.
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
APPENDIX 3: ABOUT THE AUTHORS AND RELATED RESEARCH
Simon Zadek works on sustainability issues worldwide and is an independent advisor and author.
Simon is Senior Visiting Fellow at the Centre for International Governance Innovation and Senior Fellow at the
Global Green Growth Institute. He is an advisor on sustainability to the World Economic Forum focused on climate
finance and sustainable consumption; an honorary professor at the University of South Africa; and an associate
senior fellow at the International Institute of Sustainable Development. From 2006 to 2011, he was nonresident senior
fellow at the Centre for and Business and Government of Harvard University’s Kennedy School. He founded and
was chief executive of AccountAbility, where he established the organization’s global leadership in sustainability
standards, collaborative governance, and responsible competitiveness. Prior to this, he was the founding chair of
the Ethical Trading Initiative and a director at the New Economics Foundation. Simon is a member of the China
Council International Co-operation on Environment and Development’s Task Force on Trade and Environment. He
sits on the International Advisory Board of the Brazilian business network, Instituto Ethos; the Advisory Board of the
sustainability fund manager, Generation Investment Management; and the boards of the International Centre for
Trade and Sustainable Development and the Employers’ Forum on Disability.
Simon Zadek has written this paper purely in his personal capacity.
Kelly Yu is one of China’s pioneering practitioners in CSR and a dedicated professional in
sustainability research. She has worked with local and international institutions in China, including companies,
government agencies, think-tanks, and development organizations. Her background spans from inside company
operations and consulting firm services to collaborative delivery of research, networking, consulting, and training
across various institutions. Kelly started her career with leading MNCs in China and became specialized in corporate
communication. Her business experiences inspired her to further her career in Corporate Social Responsibility and
broader sustainability issues at both practical and research levels. She served as the China leader for AccountAbility,
managing advisory services, training, and research engagements. These included leading a research partnership
between AccountAbility and the DRC (Development Research Center of State Council) on “Responsible Business
in Africa: Chinese Business Leaders’ Perspectives on Performance and Enhancement Opportunities,” which gained
wide recognition.
Maya Forstater has worked for more than ten years in the field of sustainable business, leading
research and helping organizations learn, improve, and communicate on issues ranging from climate
change to supply chain labor standards. She has worked with major corporations, multisector partnerships,
and business groupings in the energy, ICT, apparel, mining, and minerals and mobility sectors, and has written
extensively on a range of issues related to sustainability and business. She has authored and contributed to
numerous publications including Responsible Business in Africa: Chinese Business Leaders’ Perspectives (Harvard);
“Low Carbon Growth Plans: Advancing Good Practice” (Project Catalyst); Mobility for Development (WBCSD); The
UNEP/AccountAbility Handbook on Stakeholder Engagement; The Materiality Report (AccountAbility); Corporate
Responsibility: Implications for SMEs in Developing Countries (UNIDO); and Business and Poverty: Bridging the
Gap (IBLF) .
23
Corporate Responsibility and Sustainable Economic Development in China: Implications for Business
FURTHER RELEVANT RESEARCH BY THE TEAM INCLUDES:
Forstater, Maya, Simon Zadek, Yang Guang, Kelly Yu, Chen Xiaohong, and Mark George (2010), Corporate
Responsibility in African Development: Insights from an Emerging Dialogue, Institute of West Asian
and African Studies of the Chinese Academy of Social Sciences, Working Paper 60, Corporate Social
Responsibility Initiative, Harvard Kennedy School, Cambridge, Mass.
Guoqiang, L, Simon Zadek, and Joshua Wickerham (2009), Advancing Sustainable Competitiveness of China’s
Transnational Corporations, Development Research Centre of the State Council with AccountAbility, London.
Litovsky, Alejandro, Steven Rochlin, Simon Zadek, and Brian Levy (2007), Investing in Standards for Sustainable
Development: The Role of International Development Agencies in Supporting Collaborative, AccountAbility,
London.
Zadek, Simon (2001, republished 2007), The Civil Corporation, Earthscan Books.
Zadek, Simon (2002), Third Generation Corporate Citizenship, Foreign Policy Centre, London
Zadek, Simon (Dec. 1, 2004), Path to Corporate Responsibility, Harvard Business Review.
Zadek, Simon (2008), More is Not Enough in Shaping Up: Scaling Voluntary Standards: 8-10, Federal Ministry for
Economic Co-operation and Development, Bonn.
Zadek, Simon, Chen Xiaohong, Li Zhaoxi, Jia Tao, Zhou Yan, Li Guoqiang, Kelly Yu, Maya Forstater, Guy Morgan (2009),
Responsible Business in Africa: Chinese Business Leaders’ Perspectives on Performance and Enhancement
Opportunities Working Paper 54, Corporate Social Responsibility Initiative, Harvard Kennedy School,
Cambridge, Mass.
Zadek, Simon, Maya Forstater, Kelly Yu and Jon Kornik (2010), ICT and Low Carbon Growth in China, Digital Energy
Solutions Campaign, Beijing.
For more details, visit www.zadek.net.
24